By RONNIE ELLIS
Kentucky’s attorney general is going after an organization established by major lending institutions to allow them to buy and trade mortgages outside the public view and to avoid state filing fees for such trades.
Jack Conway on Wednesday filed suit in Franklin Circuit Court against MERSCORP Holdings and its subsidiary Mortgage Electronic Registration Systems (MERS) for “violating Kentucky statutes by not recording transfers of mortgages.”
Kentucky law, and the laws of most states, requires mortgages and “assignments” or transfers of mortgages to be recorded in Kentucky in the offices of county clerks.
MERS, created in 1995 by the mortgage industry and such stockholders as Bank of America, Wells Fargo, Fannie Mae, Freddie Mac and Mortgage Bankers Association, enabled those lenders to avoid the $12 Kentucky recording fee for thousands of such transactions and to make it easier for the institutions to pursue foreclosure, Conway said.
In all MERS has more than 6,500 member institutions, Conway said, and has registered more than 70 million mortgages nationally allowing the member institutions to avoid nationwide recording fees of $2 billion dollars, Conway and his suit allege.
For the full story, see the print or e-edition of Thursday's Glasgow Daily Times.